Business Policies on Human Rights.pdf

8/14/2019 Business Policies on Human Rights.pdf

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Business Policies on Human Rights: An Analysis of Their Contentand Prevalence Among FTSE 100 Firms

Lutz Preuss Donna Brown

Received: 7 September 2010 / Accepted: 18 November 2011 / Published online: 11 December 2011

Springer Science+Business Media B.V. 2011

Abstract The new millennium has witnessed a growing

concern over the impact of multinational enterprises(MNEs) on human rights. Hence, this article explores (1)

how wide-spread corporate policies on human rights are

amongst large corporations, specifically the FTSE 100

constituent firms, (2) whether any sectors are particularly

active in designing human rights policies and (3) where

corporations have adopted such policies what their content

is. In terms of adoption rates of human rights policies,

evidence of exemplary approaches in individual companies

contrasts with a less satisfactory engagement pattern across

the sample, as 42.8% of firms do not seem to address

human rights at all. With regard to the content of corporate

human rights policies, the study found shallow commit-

ments to dominate, where companies focus on a narrow

range of negative rights, i.e. on respecting human rights,

rather than positive ones, i.e. initiatives to protect or fulfil

human rights.

Keywords Human rights Corporate social

responsibility Multi-national enterprises

UN Declaration of Human Rights

Introduction

The rapid globalisation of recent years has offered multi-

national enterprises (MNEs) a vastly expanded geographic

radius for their operations. The global opportunities to

search for novel sources of raw materials, cheaper labourand new customers are, however, not matched by the

emergence of transnational governance structures (Cassel

2001; Wettstein 2009). One area where this mismatch is

particularly noticeable concerns the role of MNEs in

upholding or violating human rights (Muchlinski 2001;

Sullivan 2003). Concern over the impact of business on

human rights has been fuelled by a number of cases where

MNEs have colluded with host governments in the viola-

tion of such rights (Monshipouri et al. 2003; Holliday

2005; Wettstein2010); however, there are also companies

that have successfully engaged with human rights chal-

lenges. As part of a wave of MNE withdrawals from

Myanmar in the early 1990s, Levi Strauss stated that the

company found it not possible to do business without

directly supporting the military government and its perva-

sive human rights violations (quoted in Holliday 2005,

p. 332). If such examples spread, they might thus lead to

the possibility that transnational corporations may emerge

as a major force in promoting human rights globally

(Carasco and Singh 2008, p. 374).

Driven by non-governmental organisations (NGOs),

such as Amnesty International (Avery 2000; Frankental

2002), and intergovernmental organisations (IGOs), like

the United Nations through the Global Compact, the Spe-

cial Representative of the Secretary-General on Human

Rights and Transnational Corporations and other Business

Enterprises or the Human Development Reports (see in

particular SRSG2008and UNDP2000), an intense debate

regarding the role of business in human rights has devel-

oped in recent years. This debate covers a wide spectrum of

views. At one extreme there is the view that MNEs con-

tribute to economic development across the globe and

through this enhance human rights conditions; at the other

L. Preuss (&) D. Brown

School of Management, Royal Holloway,

University of London, Egham, Surrey, UK

e-mail: [email protected]

D. Brown

e-mail: [email protected]

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J Bus Ethics (2012) 109:289299

DOI 10.1007/s10551-011-1127-z


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extreme is the argument that MNEs create highly uneven

economic development and thus contribute to lower levels

of human rights protection (Meyer 1996; Monshipouri

et al. 2003; Leisinger2006; Wettstein2009,2010).

From a business perspective, the danger arises that if

business does not get involved in shaping the debate it risks

leaving the interpretation of human rights entirely to NGOs

and IGOs. As there has been little prior research into howhuman rights are conceptualised at company level (Sulli-

van and Seppala 2003), this article will pose three inter-

linked research questions: First, how wide-spread are

corporate policy documents on human rights? Second, are

there particular sectors where these are more common than

in others? Third, where MNEs engage with demands to

uphold human rights, which issues do they addressand

which do they not? The main contribution the article seeks

to make to the literature lies thus in taking stock of what

the current level of corporate commitment to human rights

is. This leads to auxiliary contributions to the on-going

debate regarding the nature of corporate responsibilities tosociety, such as whether voluntary initiatives are sufficient

to safeguard satisfactory standards of corporate behaviour.

The article is structured in the following fashion. A review

of the philosophical and political science literature on the

nature of human rights is extended to a discussion of a role

of business in upholding these. Next, the research method

underlying the data collection for the article is explained.

This is followed by the presentation of the findings in

relation to the three research questions. Finally, the con-

clusions summarise the discussion, state limitations and

point to avenues for future research.

On the Nature of Human Rights

A right can be defined as a claim against someone whose

recognition as valid is called for by some set of governing

rules or moral principles (Feinberg1970, p. 257; see also

Dworkin1977; Donnelly1985). Since rights under such a

definition can be cancelled out by counter-rights, scholars

have explored whether some categories of rights express a

more fundamental entitlement than others. In the late

seventeenth century, Locke (1690/1980) tried to achieve

this through the concept of natural rights, which he con-

ceived of as a fundamental property of humanhood.1 In the

twentieth century, the notion of human rights gained

ground, a special category of rights that all persons enjoy

qua their status of being a human (Gewirth1982; Donnelly

1985,2003).

Human rights have been defined as rights of every

human being to the necessary condition of human action,

i.e. those conditions that must be fulfilled if human action

is to be possible either at all or with general chances of

success in achieving the purposes for which humans act

(Gewirth 1982, p. 3).2 They thus express minimum con-

ditions for a dignified life worthy of a fully human being

(Donnelly1985, p. 33; see also Rawls 1993; Nickel2007).Human rights are of universal character: all humans

equally need the necessary conditions of purposive human

action; hence all humans are equally entitled to human

rights (Gewirth1982, Donnelly1985, 2002; Nickel2007).

At the same time, any bearer of a human right is also

subjected to restrictions arising from the human rights of

other persons. In particular, the freedom of potential

interferers must be interfered with (Gewirth 1982, p. 16);

hence human rights cannot be absolute, although their

infringement requires good arguments, such as the exis-

tence of another human right (Gewirth 1982).

Human rights have emerged from different traditions, orchronologically speaking, emerged in several generations

(Monshipouri et al. 2003; Nickel 2007). First, there are

civilpolitical rights, such as a right to freedom of

expression or to freedom from arbitrary arrest. Standing in

a liberal tradition, these rights focus on the protection of

the individual from the power of the state. Sometimes

equated with negative rights, such rights typically entail

minimum standards to avoid the worst acts of arbitrary

application of state power (Donnelly 1998). A second

group are socio-economic rights, such as a right to a fair

wage, to basic health care or to rest and leisure. They

developed from a socialist perspective in the wake of social

upheavals and class struggle during the industrialisation of

Western democracies. Sometimes equated with positive

rights, such rights comprise of more extensive demands of

the state to intervene on behalf of the individual (Donnelly

1998). Third, some authors make a case for collective

developmental rights of peoples and groups, such as special

protection for ethnic and religious minorities. These largely

developed out of the decolonialisation struggles in the

twentieth century (Twiss 2004; for a critical view of col-

lective rights see Donnelly2003). Although the concept of

human rights as such is today largely acknowledged, the

precise content of any list of human rights remains highly

contested.

Human rights have been discussed in a range of guid-

ance documents. At the IGO level, the most important one

1For a discussion of the differences between natural and human

rights, see Donnelly (1985).

2Gewirth (1982, p. 4) bases human rights on the rational agency of

humans: persons act for purposes they regard as good. Because every

agent regards his purposes as good, he must regard as necessary goods

the freedom and well-being which are the necessary conditions of his

action for any of his purposes. For a critique of this approach, see

Rorty (1993).

290 L. Preuss, D. Brown

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is the Universal Declaration of Human Rights, adopted by

the United Nations General Assembly in 1948 and formally

endorsed by most of the countries of the world (Frankental

2002; Donnelly 2003; Nickel 2007; Ishay 2008). Its stip-

ulations were spelled out in the International Covenant on

Civil and Political Rights and the International Covenant

on Economic, Social and Cultural Rights, which both were

adopted by the United Nations General Assembly in 1966.Both also reflect the different emphases during the Cold

War by Western democracies and Eastern European com-

munist countries in their respective approaches to the

human rights debate (Muchlinski 2001; Ishay 2008). The

UN system is also author of a range of more specific human

rights conventions, including the Convention on the

Elimination of All Forms of Discrimination against

Women of 1979 or the Convention on the Rights of the

Child of 1989 (Nickel2007).

In Europe, the Council of Europe adopted the European

Convention for the Protection of Human Rights and Fun-

damental Freedoms in 1950. The Conference on Securityand Cooperation in Europe also stated in its Final Act,

adopted in Helsinki in 1975, that signatory states will

respect human rights and fundamental freedoms. Last but

not least, the European Union had its Charter of Funda-

mental Rights of the European Union approved by the

European Parliament and the European Commission in

2000 (Ishay 2008). Human rights are furthermore

enshrined in numerous documents adopted by national

governments, such as the Magna Charta in England, signed

in 1215, Frances Declaration of the Rights of Man and of

the Citizen of 1789, the United States Bill of Rights of

1798 or the United Kingdoms Human Rights Act 1998

(Nickel2007). However, in these documents human rights

are largely seen as the domain of the state; hence there has

traditionally been little reference to business in national

and international documents on human rights (Donnelly

1985; Meyer1996).

The Role of Business in Human Rights

Early important initiatives to clarify the human rights

obligations of business, particularly of MNEs, are the

various ILO Conventions, which address particular work-

related aspects of human rights. Another key example are

the OECD Guidelines for Multinational Enterprises, which

were adopted in 1976 and last revised in 2010. Although

mainly concerned with issues of corporate governance, the

OECD Guidelines address employment and industrial

relations, environmental issues and consumer interests too

(Leipziger2010; Carasco and Singh2008). In 2000, former

UN Secretary-General Kofi Annan was instrumental in

launching the UN Global Compact, a list of ten principles

of responsible management, which include two explicit

human rights principles (Fussler et al.2004; Mertus2009).

The UN Sub-Commission on the Promotion and Protection

of Human Rights (now replaced by the UN Human Rights

Council) also drew up Norms on the Responsibilities of

Transnational Corporations and Other Business Enterprises

with Regard to Human Rights in 2003 (Weissbrodt and

Kruger2003). The Sub-Commission furthermore asked theUN Secretary-General to appoint a Special Representative

on the Issue of Human Rights and Transnational Corpo-

rations and other Business Enterprises (Jerbi 2009).

A number of NGOs have drawn up human rights guid-

ance documents too, such as Amnesty International with its

Human Rights Principles for Companies (Leipziger2010).

Various industry associations have also designed their own

guidance documents on the subject. As an early example,

the Sullivan Principles were designed in 1977 to promote

racial equality within US companies operating in South

Africa. They were relaunched in 1999 as the Global Sul-

livan Principles of Social Responsibility (Leipziger 2010;Carasco and Singh 2008). With a view to rendering cor-

porate performance on human rights comparable, the

Global Reporting Initiative developed indicators for a

companys human rights performance (GRI 2006). More

recently, in 2008, the International Chamber of Commerce

adopted a policy statement on human rights too (ICC

2008).

Last but not least, there have been important multi-

stakeholder initiatives to clarify the nature of human rights

and the role of business in upholding these; thus the

Business Leaders Initiative on Human Rights, the UN

Global Compact and the Office of the High Commissioner

on Human Rights produced Guidelines for Integrating

Human Rights into Business Management. In terms of

sector-specific initiatives, a dialogue between the govern-

ments of the US and the UK, companies in the extractive

and energy sectors and NGOs led to the establishment of

the Voluntary Principles on Security and Human Rights

(Jerbi 2009). Another sectoral example is the Ethical

Trading Initiative, an initiative by UK-based retailers, in

conjunction with trade unions, NGOs and the UK gov-

ernment, to establish social and environmental criteria for

their supply chains (Blowfield 2002; Preuss 2009). With

regard to the trade in diamonds, the Kimberley Process

seeks to certify diamonds to curb their sale to fund conflict

(Maconachie2009).

The existence of these documents and initiatives does

not quite settle the question of how far business should get

involved in the protection of human rights. A useful dis-

tinction here is the one made by the Special Representative

in his third report to the UN Human Rights Council in 2008

between protecting, respecting and fulfilling or remedying

human rights (SRSG2008; see also UNDP2000; Wettstein

Business Policies on Human Rights 291

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2009).3 Respecting human rights demands that companies

refrain from any interference with individuals exercise of

their rights, protecting human rights requires business to

prevent abuse by other societal actors within the limits of

their abilities, whilst fulfilling human rights asks firms to

contribute to meeting economic, social and cultural rights.

Regarding the protection of human rights, one can fur-

thermore distinguish between direct, beneficial and silentcomplicity in human rights abuses (OHCHR and UNGC

2007). Direct complicity involves consciously assisting a

third party in human rights violations, beneficial complicity

occurs where a firm is benefiting directly from human

rights abuses by a third party, whilst silent complicity, the

category that is most difficult for business to address, refers

to situations where companies are expected to speak up

about human rights abuses they become aware of (Lei-

singer2006; Wettstein2010).4

Demands for a business role in protecting, respecting

and remedying human rights are often discussed in terms of

a companys sphere of influence. For example, the UNGlobal Compact asks companies to embrace, support and

enact, within their sphere of influence, a set of core values

in the areas of human rights, labour standards, the envi-

ronment and anti-corruption. This is usually taken to mean

a companys core operations, its business partners and its

host communities (Leisinger 2006; for a critique of this

approach see Wettstein 2009). In a nutshell, the precise

extent of the role business should play in upholding human

rights is still an unresolved question. This is the back-

ground against which this article will examine to what

extent large companies, here the FTSE 100 member firms,

have adopted the concept of human rights and, where they

have, what issues they address under the heading of human

rights.

Research Method

The research process began by obtaining the list of the

FTSE100 constituent firms on 1 July 2009. The sample

comprises of a total of 98 firms, because the FTSE 100

index included both A and B shares for Royal Dutch Shell

as well as separate listings for Schroders and Schroders

N/V. The websites of these firms were then checked for

displays of CSR tools that may address human rights. One

of the most popular tools through which companies deal

with CSR issues is the code of conduct (World Bank2003).

Hence this study examined corporate websites for codes of

conducts and their subsidiary documents, such as stand-

alone human rights policies, CSR/corporate citizenship

policies, environmental or sustainability policies or ethicalsourcing policies.5 Corporate websites can be taken as an

approved, formal and official perspective on CSR (Bondy

et al.2004). Analysing information displayed on corporate

websites is furthermore taken as a reliable research method,

since prior research into CSR tools amongst FTSE 100

companies found that the vast majority of such documents

are hosted on corporate websites. In one study, CSR

managers were approached for CSR tools that were not

displayed on their companies websites but the additional

documents received constituted a mere 3% of the total

sample (Preuss2010).

With regard to the first research question, the degree ofadoption of human rights policies amongst the sample

firms was established. To generate a fuller picture, the

research also established all cases where information on

human rights issues was included in other CSR tools. A

distinction was made here between a separate section in a

CSR tool and an isolated reference, with the former being

defined as consisting of at least a separate heading and two

sentences of text. With regard to the second research

question, the emerging pattern of engagement was exam-

ined against the industry composition of the FTSE 100

index to determine whether industry differences influence

the adoption of human rights policies. Industry classifica-

tion was established with reference to the UK Standard

Industrial Classification of Economic Activities 2007 (ONS

2007). Third, the content of the separate human rights

policies was analysed by checking these against the indi-

vidual articles of the UN Declaration, the most widely

accepted document in the field of human rights (Cassel

2001, p. 261; see also Donnelly 2003; Sullivan2003).

The content analysis of the FTSE 100 documents was

undertaken manually and counted the frequency of an item

being mentioned rather than attempting to measure the

degree to which it is discussed. As Wood (2000, p. 288)

states, some concepts are more difficult to express con-

cisely than others, hence the amount of space devoted to an

item may not necessarily correlate with the importance

assigned to it by a company. The content analysis con-

sidered only text without appendices, as these were found

3 The UNDP (2000) trio of respecting, protecting and fulfilling

human rights was proposed specifically in relation to the impacts of

governments on human rights.4 Oil company BP, for example, comments on the problems of

limited corporate reach: In the three areas of employees, commu-

nities and security, where we have direct control, our responsibility

and positions are straightforward. Our greatest challenges occur

in situations outside of our direct controlfor example, in joint

ventures where we do not hold a controlling interest, or in interactions

with other third parties.

5Kaptein (2004, p. 13) defines a code of conduct as a policy

document that defines the responsibilities of the corporation towards

its stakeholders and/or the conduct the corporation expects of

employees. On the differences between the various CSR tools, see

Preuss (2010) and Leipziger (2010).


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to often repeat key external guidance documents, such as

the UN Declaration. Overall, the studys research method

is comparable to those of previous studies that analysed the

content of corporate codes (e.g. Wood 2000; OECD2001;

Bondy et al. 2004; Kaptein 2004; Kolk and van Tulder

2004; Lugli et al. 2009; Preuss2010).

Adoption Rates of Human Rights Policies

Regarding the first research question, to what extent MNEs

include references to human rights in their CSR tools, the

study found that just over half (57.1%) of the 98 firms in

the FTSE 100 index address human rights in either a sep-

arate human rights policy or in another CSR tool, such as a

code of conduct or a CSR policy (see Table 1); however,

42.8% of firms do not seem to address human rights at all.

Of these, 11.2% are firms for which no CSR tools could be

identified. Notably, almost a third (31.6%) of all firms

adopted at least one CSR tool but do not discuss humanrights in these.

The FTSE 100 firms that address human rights in their

CSR tools do so in three major ways: (1) through stand-

alone human rights policies, (2) through designated sec-

tions in codes of conduct or other CSR tools or (3) through

more or less substantial references in the text of these CSR

tools that fall short of forming a designated section. To

avoid duplication, the following analysis counts only the

most advanced mode of addressing human rights, i.e.

where a company has a separate policy other CSR tools

were no longer examined. Some firms furthermore com-

mented on industry level commitment. For example, oil

company BP refers to guidance material by the Interna-

tional Petroleum Industry Environmental Conservation

Association (IPIECA) and the Voluntary Principles on

Security and Human Rights. Due to a lack of space, such

industry level documents could, however, not be consid-

ered here.

22 companies (22.4%) of the FTSE 100 firms have a

separate human rights policy. These range from one page

documents, e.g. at BG, British American Tobacco, Friends

Provident, GlaxoSmithKline, Intercontinental Hotels

Group, International Power, Man Group, Royal Bank of

Scotland, to longer documents, such as Barclays State-

ment on Human Rights of 13 pages, Rio Tintos Human

Rights Guidance of 23 pages or BPs Human Rights: A

Guidance Note of 28 pages. Shell has a document entitled

Human Rights Dilemmas: A Training Supplement, which

runs to 20 pages. The longer of these policies, in particular

the documents by Rio Tinto, BP and Shell, offer an

explanation of what human rights mean and why thecompany needs a human rights policy, then discuss a range

of stakeholders where human rights abuses may be a par-

ticular issue, thereafter outline the companys position on

dealing with these, then describe how the company man-

ages its commitments and finally offer links to sources of

further information.

Designated sections on human rights were identified in a

further 13 companies (13.3%). These tend to be more

concise than the separate policies, but they usually refer to

external reference documents for human rights, in partic-

ular the UN Declaration, provide a rationale of why the

firm promotes human rights and offer some information onhow it aims to do this. The length of these sections ranges

from 46 words at insurance company Aviva and media firm

Reed Elsevier to 351 words at business services company

Serco. The isolated references tend to be even sparser in

their content than the designated sections. They usually

contain some standards that are to be upheld and a rationale

of why the company insists on these, but in the majority of

cases these are no longer backed up with references to

external reference documents. In some cases, there is

extensive coverage of various human rights aspects, e.g. in

the document Our Ethical Trading Standards by retail firm

Home Retail Group; however, six companies go no further

than stating that they endeavour to uphold human rights

without further explanation what this means to them. In

terms of length, the isolated references range from 285

words at Home Retail Group to nine words at tour operator

TUI, which merely states that TUI professes its regard and

observance of human rights.6

To summarise this section, the study found some evi-

dence of a systematic engagement with human rights. For

example, British American Tobacco has a separate human

rights policy, a section in its Philosophy for Supplier

Partnerships and isolated references in its code of conduct.

However, across the sample the picture is less satisfactory.

Here, the finding is particularly noteworthy that the largest

group of 31.6% are companies that do have CSR tools in

place but do not include human rights in these. Thus some

doubt emerges as to how far corporate commitment to

human rights protection actually goes. Another notable

Table 1 Human rights in the CSR tools of FTSE 100 firms

CSR tool n = 98 %

Human rights policy 22 22.4

Section in code of conduct or other CSR tool 13 13.3

Reference in code of conduct or other CSR tool 21 21.4

CSR tool without reference to human rights 31 31.6

No CSR tool 11 11.2

6 TUI states that its code of conduct is a translation from German.

However, the commitment to human rights in the original version of

the code amounts to exactly the same lengthnine words.


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finding is the salient role of firms in the oil and gas

industries. Such sectoral aspects are discussed in the next

section.

Industry Patterns

Addressing the second research question, the emergingpattern of engagement with human rights was examined

against the industry composition of the FTSE 100 index

(Table2). Outstanding sectors in terms of adoption rates of

separate policies are alcoholic beverages, the oil and gas

industry as well as tobacco (although the first and third of

these consist only of two firms each). Designated sections

in CSR tools are particularly found in the business and

professional services sector, whilst isolated references are

typical for the food sector and are also often found in the

extractive industry. Sectors with high adoption rates of

CSR tools that do not include human rights are property

management and construction, manufacturing, retailing,utilities and media. Finally, the largest number of firms

without CSR tools was found in financial services other

than banking and insurance, principally investment funds.

The performances of two sectors invite further com-

ment, namely those of utilities and retailing. In both cases

half, or slightly more, of all firms have CSR tools but do

not address human rights. This contrasts with greater levels

of engagement with CSR in general terms, as expressed for

example in the rankings of utilities and retailers in the

Corporate Responsibility Index by Business in the Com-

munity (BitC 2010). However, utilities have a predomi-

nantly domestic market and may primarily see their CSR

impact in environmental terms. The low exposure to

developing countries may thus translate into a lesser need

to engage with human rights issues. Retailers, by contrast,have a huge exposure to human rights issues through their

supply chains, which depends, of course, on the countries

they source from. Many of the FTSE 100 firms have been

active in the Ethical Trading Initiative (Blowfield 2002;

Preuss 2009). They may thus perceive human rights as a

topic that is addressed sufficiently through this initiative;

although this would throw open the question as to what

extent stand-alone CSR initiatives are woven into corporate

strategy and operations.

This study provides further support for the role of public

pressure in CSR, as the most thorough engagement with

human rights issues was found in typical limelightindustries or perceived sin industries, such as the alco-

holic beverages, tobacco or oil and gas ones. For example,

the three longest human rights policies were all found in oil

and gas companies. This seems to be an indication that the

public scrutiny that surrounds the sector has translated into

an above-average attention to human rights. By contrast,

three industries showed little interest in the subject, namely

Table 2 Adoption rates of

human rights policies by

industry

Industry n Separate

policy

(in %)

Section

(in %)

Isolated

reference

(in %)

CSR tool without

reference to

human rights (in %)

No CSR

tool (in %)

Alcoholic beverages 2 100 0 0 0 0

Oil & gas 7 57 14 14 14 0

Tobacco 2 50 0 50 0 0

Banking 5 40 0 20 40 0

Food 3 33 0 67 0 0

Pharmaceutical 3 33 0 33 33 0

Utilities 6 33 0 17 50 0

Insurance 7 29 29 0 29 14

Chemical 4 25 25 25 25 0

Hotel, leisure 4 25 0 25 50 0

Other financial 8 25 0 13 13 50Telecom and IT 7 14 29 14 14 29

Retail 7 14 0 29 57 0

Extractive 10 10 10 40 10 30

Business services 7 0 43 14 43 0

Media 4 0 25 25 50 0

Property, construction 5 0 20 20 60 0

Manufacturing 7 0 14 14 57 14

Transport 1 0 0 0 100 0

Sample average 98 22.4 13.3 21.4 31.6 11.2


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investment trusts (i.e. financial services other than banking

and insurance), property management and construction

companies as well as media firms. This is a finding of

considerable importance for discussions of the effective-

ness of CSR. At times media firms can have a direct impact

on human rightssee for example the questionable meth-

ods used by the News of the Word newspaper to gain

access to informationbut they also play an enormous rolein shaping the debate about the global economy. Financial

services firms can have a significant impact on human

rights through the investments they undertake. It is there-

fore striking that the companies in these sectors have so far

abstained from a more public discussion of their human

rights impacts. Having examined patterns of engagement

with human rights, the next section will now shine a light

on the content of these documents.

Content Analysis of Human Rights Policies

As its third research question, the study sought to identify

more specifically which aspects of human rights MNEs

supportand which they do not. Some of the stand-alone

human rights policies use a stakeholder approach to outline

what human rights aspects the company sees as important

with respect to key stakeholders. For example, the policy

by telecommunications firm Vodafone has sections on

employee human rights, customer human rights and human

rights in the supply chain. These are supplemented with

additional policies on health and safety, equal opportunities

and diversity, customer privacy and ethical purchasing.

However, to gain a more in-depth picture of corporate

human rights policies, as the most advanced mode of

addressing human rights, their content is now compared

with that of the UN Declaration of Human Rights. Having

examined all of the corporate documents, the proportion of

the sample is indicated that mentions each specific human

right (see Table 3 and Appendix1).

The UN Declaration contains a total of 37 human rights.

Of these, the ones that the FTSE 100 companies have

embraced most systematically are no discrimination

(95.5%), the right of association (81.8%) and the right to

join and form trade unions (77.3%). These are followed by

a prohibition of slavery (59.1%), respect for human dignity

and a ban on torture or other inhumane treatment (both

50%). Thereafter, inclusion rates fall quickly for issues

such as just remuneration (45.5%), the right to life, liberty

and security or duties to the community (both 36.4%). Of

the 37 rights, only six are thus addressed in half or more of

the FTSE 100 firms human rights policies. At the bottom

of the table, there is a whole range of issues that are not

addressed by a single company, such as the rights to public

services, to social security or to freedom of movement. As

the UN Declaration was primarily addressed to govern-

ments, it contains a number of issues that are not applicable

to business, such as the right to nationality, the right to

remedy by national tribunal or to family life. However,

with regard to the latter, business can have an impact again

in terms of a work-life balance for employees (Eikhof et al.

2007) or the conditions in employer-controlled accommo-

dation (Smith and Pun2006). Similarly, collective humanrights find little resonance in the corporate documents,

where the right to an international order that realises rights

and freedom is again not addressed in a single human rights

policy. Instead, companies stress that it is the duty of

government to uphold human rights. For example phar-

maceutical firm GSK writes:

We believe that governments have the responsibility

to define and enforce a legal human rights framework

that accords with international laws and agreements,

such as the Universal Declaration of Human Rights.

Businesses alone cannot resolve all the issues thatarisea response in partnership with others who

have the mandate, competence and capacity to

facilitate change is essential.

Nonetheless, there are some rights where inclusion rates

are low, although the issue at hand is closely linked to the

world of work. Notable amongst these are the right to

privacy and the right to leisure (both 18.2%), the right to

work, free employment (13.6%) and to equal pay for equal

work (13.6%). The latter was drawn up to address in

particular gender-based inequality, and its low inclusion

rate contrasts with the somewhat more mainstream empha-

sis on just remuneration (45.5%). Companies may absolve

themselves of action to protect human rights, laying the

responsibility before national governments; however, an

analysis of UK legislation in this area indicates a contin-

uing reluctance to adopt many of the principles laid out in

the UN Declaration. In addition to identifying which of the

UN principles appear in the sample companies CSR tools,

Table3also identifies which human rights are enshrined in

UK legislation. UK law addresses 18 of the 37 human

rights mentioned in the UN Declaration fully and four

further ones with caveats.7 It emerges thus that despite

pointing to a government role in upholding human rights,

corporate commitment to human rights amongst the FTSE

100 firms seems to fall significantly short of UK legal

stipulations.

In terms of the distinction above between require-

ments to respect, protect and fulfil human rights (UNDP

2000; SRSG 2008; Wettstein 2009), the issues that the

FTSE 100 firms address are predominantly of the first type.

7The information presents the authors lay interpretation of the UK

Human Rights Act of 1998 and the Equality Act of 2010.


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By contrast, issues that require a firm to contribute to

meeting economic, social and cultural rights are included

far less often, if at all, such as a right to a decent standard

of life (18.2%) or a right to a cultural life (9.1%). At the

same time, there are individual firms that engage with these

issues. For example, energy company BG moves firmly

into the terrain of protecting human rights when it promises

to defend employees and seek legal redress in cases of

arbitrary arrest, detention without fair trial, torture or extra-

judicial killing. Financial services firm Barclays is one of

the few companies that comments on the possibility of exit

where human rights violations persist: In cases where we

Table 3 Content comparison:

corporate human rights policies

versus UN Declaration

The comparison of UK

legislation in the area of human

rights with articles of the UN

Declaration of Human Rights

reflects lay opinion rather than

being informed by legal

expertisea

Addressed with caveats or in a

limited fashion by the UK

Human Rights Act of 1998

b Addressed by the UK

Equality Act of 2010

UN Declaration Principle

Article No. Content summary Inclusion

in UK

legislation

Corporate

references

(in %)

2 No discrimination Yes 95.5

20 Right of association Yesa

81.8

23 (4) Right to form and join trade unions Yes 77.34 No slavery, no servitude Yes 59.1

1 Human dignity No 50.0

5 No torture, cruel or inhumane treatment Yes 50.0

23 (3) Just remuneration No 45.5

3 Right to life, liberty and security Yes 36.4

29 Duties to community No 36.4

19 Freedom of expression Yes 22.7

12 Right to privacy Yes 18.2

24 Right to leisure, limitation of working hours No 18.2

25 Decent standard of life (food, clothing, housing

and medical care)

No 18.2

10 Fair hearing and independent tribunal Yesa

13.6

18 Freedom of thought and religion Yes 13.6

21 (1) Right to political activity Yesa

13.6

23 (1) Right to work, free employment No 13.6

23 (2) Equal pay for equal work Yesb

13.6

26 Right to education Yes 13.6

27 (1) Right to cultural life No 9.1

9 No arbitrary arrest Yes 4.5

17 Right to own property Yes 4.5

27 (2) Protection of intellect property rights No 4.5

6 Right to recognition as a person before the law No 0.0

7 Equality before the law Yes 0.0

8 Right to remedy by national tribunal Yesa

0.0

11 (1) Innocent until proven guilty Yes 0.0

11 (2) No retrospective application of laws Yes 0.0

13 Freedom of movement No 0.0

14 Right to asylum No 0.0

15 Right to nationality No 0.0

16 Right to family life; free marriage Yes 0.0

21 (2) Right to equal access to public services No 0.0

21 (3) Free elections Yes 0.0

22 Right to social security No 0.0

28 Right to international order that realises

rights and freedom

No 0.0

30 No right to destruction of rights Yes 0.0


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discover that we are associated with violations of human

rights we will take appropriate action in mitigation. This

may include exiting a particular business relationship, or

constructive engagement with others to promote good

practice.

Companies have also inserted various limitations into

their human rights policies. Alcoholic beverages firm SAB

Miller states: This Position Paper represents aspirationsrather than binding commitments as the contents are for-

ward looking and involve certain risks and uncertainties

which are difficult to predict (similarly Barclays). Other

firms stress the limits of their reach. Here oil and gas sector

firm Cairn strives to positively address human rights

within our sphere of influence and activities. Similarly,

retailer Home Retail Group states with regard to discrim-

ination: We do recognise reluctantly that, in some parts of

the world, these discriminatory divisions run so deep that it

is unrealistic to expect employers to manage a mixed

workforce without major societal changes taking place.

To conclude this section, the content analysis of thehuman rights policies of the FTSE 100 firms showed that

some work-related human rights issues find wide-spread

attention, such as a prohibition of discrimination and the

right to join and organise trade unions. Some firms may be

increasing the current level of commitment by moving

from an emphasis on respecting to protecting human rights,

although few then go on to make a case for the fulfilment

of human rights. At the same time, the overall level of

commitment amongst the FTSE 100 firms is rather shallow,

as only six of the 37 rights in the UN Declaration are

addressed in half or more of the corporate documents.

Companies furthermore focus on respecting negative rights

rather than promoting positive ones. A particular challenge

that is still terra incognita for business is the engagement

with the concept of collective human rights.

Conclusions

Globalisation has greatly increased the power of MNEs to

shape not only their own operations but also to impact on

numerous local communities around the world. This

growing power is increasingly linked to greater expecta-

tions of corporate responsibility and accountability

(Weissbrodt and Kruger 2003; Wettstein 2009). In the

words of UNDP (2000, p. 80): Society no longer accepts

the view that the conduct of global corporations is bound

only by the laws of the country they operate in. Such a

shift in expectations of corporations is particularly evident

in the area of human rights. Here too the traditional view

was that the protection of human rights is the sole

responsibility of the state. In the context of neoliberal

globalization, however, the wrongdoers are often

corporations. Reliance on state duties alone may not be

sufficient to broadly protect human rights (Monshipouri

et al. 2003, p. 965; similarly Muchlinski 2001). This shift

in expectations of corporate behaviour provided the back-

cloth against which this paper investigated the amount of

attention which large businesses, specifically the FTSE 100

constituent firms, have given to human rights.

The study found examples of companies where thescope and breadth of their engagement with human rights is

exemplary. For example, confectionary company Cadbury8

has drawn up a stand-alone human rights policy; it has also

adopted a Human Rights and Ethical Trading Policy and

discusses the subject in its code of conduct. Another

company that is exemplary at first glance is British

American Tobacco, which too has written a stand-alone

human rights policy, included a section on human rights in

its Philosophy for Supplier Partnerships and makes refer-

ences to the subject in its code of conduct. At second

glance, this commitment sits uneasily with the impact its

product has on human health. Unsurprisingly, the com-panys human rights policy refers to workplace-related

human rights and human rights in supply chains but not to a

customers right not to be harmed by a product one buys.

Across the FTSE 100 sample as a whole, the engage-

ment is less than satisfactory as 42.8% of firms do not seem

to address human rights at all. 31.6% of firms have at least

one CSR tool in place but do not refer to human rights; in

other words, almost a third of the FTSE 100 firms express a

desire to engage in socially responsible behaviour but

perceive this to be unrelated to the human rights agenda.

The content of the human rights policies was also found to

be rather shallow, as of the 37 rights in the UN Declaration

only six are addressed in half or more of the documents by

the FTSE 100 firms. Some issues that are addressed had

rather low inclusion rates, such as the rights to privacy or to

limited work hours to safeguard leisure. The predominant

emphasis in the corporate human rights policies was thus

on the negative rights to respect human rights rather than

the positive rights associated with fulfilling these. Overall,

the FTSE 100 human rights policies have thus not dispelled

fears by observers that MNCs have thus far shown meagre

interest in the sociocultural welfare or human rights of the

vast majority of the people living in host countries

(Monshipouri et al. 2003; p. 987).

Like all research, this article has a number of limita-

tions. Since its focus was on human rights policies adopted

by the FTSE 100 companies, the findings may reflect a bias

stemming from the cultural and regulatory environment of

the United Kingdom. As it utilised a content analysis

method, the study can furthermore not comment on the

8Cadbury was taken over by US company Kraft Foods in February

2010.


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impact of the identified policies on corporate human rights

performance (on the link between quality and effectiveness

of codes of conduct, see Erwin 2011). These limitations

point to a range of avenues for future research. One

insightful research design could aim to uncover cross-cul-

tural differences in corporate approaches to human rights

and thus remove the possible UK bias. As this article

focussed on large firms, further research could also inves-tigate how small- and medium-sized firms engage with the

human rights challenge. The actual impact of human rights

policies could be studied through case studies, in particular

of the companies and sectors that were identified as leaders

in this article.

Notwithstanding these limitations, the article offers a

number of contributions to theoretical conceptualisations

of CSR. These concern in particular the analysis of the role

of public pressure in CSR, both in terms of being a key

driver and in terms of having significant limitations. The

significance of public pressure for CSR is evident in the

finding that the industries that have moved furthest on thisissue are those under public scrutiny, i.e. the traditional

lime-light sectors of alcoholic beverages, oil and gas and

tobacco; however, public pressure is hampered in the reach

it has. Amongst the FTSE 100 firms, investment trusts and

property management and construction firms had, respec-

tively, the lowest rates of adopting CSR tools in general

and of adopting CSR tools but not addressing human rights

in these. Both sectors operate at considerable distance from

the critical gaze of the public, NGOs and consumers and

hence have little to fear from an underperformance in the

human rights area (Muchlinski 2001). Particularly for

financial services, a mismatch emerged between the sig-

nificant impact their investments can have on human rights

and their lacklustre engagement with the topic. In other

words, corporate engagement with human rights appears to

be driven not so much by the significance of the issue for

an industry or firm but by the degree of exposure to public

pressure the industry or firm experiences. This limited

reach of public pressure would seem to indicate, once

again, that voluntary initiatives have considerable limita-

tions for the quest to get business to accept responsibilities

that go beyond narrow economic ones.

Appendix 1: Extract from the Human Rights Policy

of Prudential Group

The Human Rights Policy of insurer Prudential Group

shows the clearest alignment with the UN Declaration in

the sample. The document refers to the individual articles

of the Declaration and lists those that the company sees as

applicable:

We strongly endorse the principles set out in the

Universal Declaration of Human

Rights, in particular those relevant to our operations

which are:

The right to freedom from discrimination;

The right to personal safety and security;

The prohibition of slavery: forced or child labour;

The prohibition of torture, cruel, inhuman or degrading

treatment or punishment;

The right to privacy;

The right to religious freedom;

The right to freedom of opinion and expression;

The right to freedom of peaceful assembly and

association;

The right to free participation in political life;

The right to work;

The right to rest and leisure

The right to an adequate standard of living;

The right to education;

The right of minorities and indigenous peoples to

protect their identity;

The right to cultural participation.

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